Arab Finance: The Financial Regulatory Authority (FRA) has granted non-banking financial institutions an additional six-month grace period to comply with regulations governing debt collection activities, extending the deadline to January 22nd, 2027, as per a statement.

Under FRA board resolution No. 139 of 2026, non-banking financial institutions will be prohibited, after the grace period expires, from engaging collection companies that are not registered in the FRA's debt collection registry.

The extension is intended to give companies additional time to meet registration requirements while strengthening oversight of debt collection activities and limiting unregulated market practices.

The FRA said it has so far approved the registration of two companies in the debt collection registry. It is also reviewing registration applications from more than 30 additional debt collection companies.

To qualify for registration, companies must submit details including their legal structure, business purpose, registered head office, and contact information for executive officers, legal representatives, and other relevant personnel to enhance transparency and facilitate verification of licensed entities.

Applicants are required to submit supporting documents demonstrating compliance with the registration requirements, including the company's articles of association, audited financial statements, and previous debt collection service contracts. The FRA will decide on applications within 30 days of receiving all required documents.

The regulations require debt collection companies to be incorporated in one of the legally recognized commercial company forms, with debt collection included among their corporate objectives. Companies must also have issued and paid-up capital of at least EGP 10 million, or the equivalent in foreign currency, and shareholders' equity of no less than EGP 20 million.

Where the minimum equity requirement is not met, companies must have been operating for at least three years before applying for registration. In all cases, shareholders' equity must not be lower than the company's paid-up capital.

The decision also requires companies and entities engaged in non-banking financial activities to inform clients about the debt collection companies they appoint, the methods customers can use to verify collectors' identities, and official communication channels. They must also monitor complaints filed against collection companies and take the necessary corrective measures.

The resolution authorizes the FRA Chairman to impose administrative measures against registered debt collection companies that violate the governing regulations, including issuing warnings, temporarily suspending registration, or removing companies from the registry, with the aim of ensuring compliance and protecting market participants.